MONEY E-Commerce

3 Ways Walmart Is Trying to Out-Amazon Amazon

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Okko Oinonen/GalleryStock

Walmart might look like the sleeping giant of e-commerce, but it has one surprising advantage in the online space.

On Monday, Walmart announced a major overhaul of its e-commerce offerings. The brick-and-mortar Goliath plans to add new features to its website in the coming months, including more personalized product recommendations, discounts available in the user’s local store, and significantly faster check-out. The moves are presumably aimed at making Walmart more competitive online with Amazon, the other dominant force in American retail.

Walmart still dwarfs Amazon in terms of total revenue, having pulled in $473 billion in 2014 compared to Amazon’s mere $60.3 billion. But Walmart’s been woefully slow to embrace online commerce, a realm where Amazon outsold the biggest-box retailer seven-to-one last year. And the larger trends have to concern the executives in Bentonville: E-commerce in the U.S. grew at about six times the rate of conventional retail over the past year.

On the other hand, Walmart is hardly the sleeping giant that it’s often portrayed as. A closer look at the company’s moves in recent years reveals a slow but consistent effort to catch up to Amazon’s online offerings. That effort is starting to pay off: Walmart’s online sales grew 30% in the 2013 fiscal year, to $10 billion. (Amazon’s online sales started at a much higher number, but grew “only” 20% during that time.)

Meanwhile, Walmart may have an ace in the hole — in the form, ironically, of its 4,900 U.S. retail outlets. Generally seen as a symbol of Walmart’s lumbering inability to adapt to the digital world, those stores may prove to be Walmart’s one big advantage in the online space.

Here are three ways Walmart is trying to turn up the heat on its major e-commerce adversary.

1. A Better Online Experience

Walmart’s Monday announcement was entirely web-centric, and focussed on an area that has long been one of Amazon’s great strengths: usability. Amazon pretty much invented one-click shopping, and has the patent to prove it. Meanwhile, users of Walmart’s old site had to go through six pages before they were allowed to click the buy button. That’s not how you win customers from the market leader. The new Walmart site, which is being rolled out gradually (about half of Walmart.com’s visitors have been using a portion of its new features), makes major strides in this area by turning the buying experience into a simple, one-page process.

Walmart will also be introducing a custom recommendation engine that serves users with customized product suggestions based on past searches, purchase history, and location. This personalization even extends into the brick-and-mortar stores by showing customers deals and coupons that they can cash in at nearby Walmart locations.

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Walmart’s new site is trying to let you buy what you want in as few steps as possible.

2. Same-Day Delivery

Amazon, eBay, and other e-retailers know their next big opportunity for growth — and the one huge disadvantage they face vis a vis brick-and-mortar stores — is the human desire for instant gratification. Overnight delivery is great, but if your iPad/TV/groceries are just a five-minute drive away, even the next day can seem like too long to wait. As a result, Amazon has been spending through the nose to build the infrastructure necessary to make same-day delivery a reality. Already, Bezos and Co. offer it in 12 metro areas.

That might sound like a lot, but Walmart has the potential to put Amazon’s same-day coverage to shame. The chain has thousands of locations across the country, and has long advertised a “Site-to-Store” feature that allows customers to order online and then pick up their order at a nearby Walmart location right away. Lately, the company has been putting increased effort behind this hybrid digital/conventional form of retail: The number of products available for same day pick-up has tripled in the past 18 months. And having a store with an actual cashier also means Walmart customers who purchase online can choose to pay for their order in cash.

If the item isn’t on shelves at the moment, Site-to-Store also replicates (and pre-dates) one of Amazon’s most useful features, Amazon lockers, by allowing customers to order nearly any item and have it delivered to a store location.

So why isn’t Walmart dominating when it comes to delivery? Well, it turns out that executing on the promise of same-day delivery isn’t so easy. Amazon Prime typically still beats Walmart shipping times on all but a select few products. But Walmart is getting better. The chain has rolled out traditional save day delivery in an increasing number of test markets, and according to spokesman Dan Toporek, has begun building out its next-generation order-fulfillment network in which online fulfillment centers work in concert with distribution centers and stores that are set up to deliver web orders to create shorter delivery times.

3. War For Your Groceries

While everything from calling a cab to shaving has been disrupted by an online ordering model, stocking up on groceries has remained a chore most of us still have to do in person. But Amazon and Walmart have been one-upping each other in recent years to change that. Amazon made the first move, having launched AmazonFresh in 2007, enabling customers to order meat, veggies, and comestibles the same way they would a new printer. Initially available only to those in the Seattle area, Fresh has expanded into Northern and Southern California.

But Walmart has battled back with Walmart To Go, which the company tested in San Francisco for three years and recently expanded to the Denver area. What’s more, To Go has at least one advantage that Amazon can’t yet offer: Shoppers can order online and then pick up in stores. Walmart claims this as a real competitive advantage: Fifty-five percent of those surveyed supposedly told the retailer that they prefer to pick groceries up themselves so they can grab any forgotten items on the way through the checkout.

Still the Underdog… For Now

Make no mistake, Amazon is still king of the online retail space, and looks likely to retain its crown for the foreseeable future. But Walmart’s online redesign and roll-out of Amazon-like features that leverage its army of stores, make it a force that no one can ignore, especially as Amazon looks less focussed than ever on its core e-commerce business.

Either way, when two giants like Amazon and Walmart fight, the consumer tends to win.

MONEY Shopping

WATCH: Walmart Wants to Be Your Amazon.com

The brick-and-mortar retail giant is revamping its website in the hopes of dominating online commerce as well.

MONEY deals

A+ Back-to-School Deals Priced from 1¢ to $1

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Catherine MacBride—Getty Images/Flickr

To get your business during prime back-to-school shopping season, stores have launched wild price wars on school supplies, starting for as little as 1¢.

We’ve compiled a checklist of some back-to-school deals that just might seem too good to pass up: None runs more than $1, and one is available for a single penny.

But before filling up your (online or actual) shopping cart, take note of a few caveats. First, despite the fact that these offers are from national retailers, prices can vary from region to region, so the deals at your local store may be different than the ones below. Second, in many cases these rock-bottom prices are only available in-store, not online. They’re essentially “loss leaders,” existing mainly to entice you into the store, where you’ll perhaps be tempted to buy other things, some of which just might be (the horror!) full price.

Lastly, customers may be limited as to how many of these super-cheap items they’re allowed to buy, to stop some bargain-hunting hoarder from cleaning out the entire store and ruining the sale for everyone else. For the most part, the prices below are valid through Saturday, August 2. If you miss out, don’t sweat it: A whole new set of back-to-school deals is sure to appear like clockwork in the Sunday circular.


When you spend at least $5 at participating Office Max and Office Depot stores, you’re allowed to buy their store-brand colored folders for a penny apiece (limit of 10 per household).

15¢ to 20¢
The “Less List” of sale items at many Staples includes two-pocket folders for 15¢ and 70-page one-subject notebooks for 17¢.

25¢
Kids’ scissors, 12-inch rulers, 6-inch protractors, and 4-oz. bottles of glue are among the back to school standards priced at a quarter each at Office Max and Office Depot.

50¢
Pick up a 24-pack of Crayola crayons (normally $1.47) at Walmart and Staples (normally $1.99).

One-subject notebooks and 5-inch scissors go for 49¢ apiece at many Walgreens.

$1
Five-pack of highlighters (normal price: $4.29) at Staples

12-pack of Bic pens (normally $1.99) at Office Max and Office Depot

12-pack of colored pencils or two-pack of Sharpies at Dollar General

Absolutely everything at Dollar Tree

MONEY

This Summer, Sharks Want to Take a Bite Out of Your Wallet

This summer, there is no escaping from sharks: shark TV shows, movies, merchandise, and even shark tourism have chomped down on America's collective imagination and are thrashing us all about.

Sharks—or more precisely, the fear of sharks—have a long history of helping to sell stuff. Movie tickets, for instance. Steven Spielberg’s “Jaws” not only kicked off the summer blockbuster as a phenomenon, but is also widely considered the biggest and best summer blockbuster film of all time. A series of sequels and other shark movies followed, as did the ever-expanding, factually questionable “Shark Week” on the Discovery Channel. In the so-called “Summer of the Shark,” in 2001 (mere weeks before 9/11, it’s often noted, when very different fears took over the American consciousness), unwarranted hype over shark attacks was used to sell magazines and keep viewers glued to 24/7 news channels, awaiting word of the next deadly aquatic encounter.

We’re still fascinated by sharks, and sharks are still being used to grab our attention and perhaps a few of our dollars. Lately, though, in an age dominated by memes and ironic-air-quotes “entertainment,” the cold-blooded mankiller of the deep has been replaced by an equally fictitious creature—the shark as adorable mascot.

This summer, “Shark Week” has been joined by the straight-to-cable arrival of the gag “movie” “Sharknado 2.” But given how much over-the-top goofball hype goes into “Shark Week” itself—Rob Lowe waterskiing atop two great whites anyone?—the Discovery Channel event seems to be its own best parody.

This summer, the merchandising of sharks and “Shark Week” has been, in a word, shark-tastic (the title of a book sold on the Discovery Channel, naturally). Among the roughly 150 items listed on the site as appropriate purchases for “Shark Week” celebration are shark kites, a Shark Week smartphone case, Shark Week bottle openers and coozies, “clever” shark T-shirts that say “Bite Me” and “I’m Hammered,” and Shark Week cupcakes that show Rob Lowe atop his pal sharks again.

Elsewhere in the ocean of summertime shark products, Dunkin’ Donuts is selling a Shark Bite Donut (the frosting resembles a life preserver) starting next week, and Cold Stone Creamery has shark-themed cupcakes and ice cream sundaes, complete with colorful gummy sharks. Limited-edition “Shark Week”-inspired soap is available at one New York City boutique, while a “Shark Week” search at etsy turns up more than 1,300 hand puppets, pencil holders, custom-designed panties, pieces of jewelry, and other crafts. A whole other list of goods have been devoted to the frenzy around “Sharknado,” including a new perfume called “Shark by Tara,” created by one of the movie’s stars, Tara Reid.

The normally sober tacticians at Consumer Reports even got in on the action, using the Sharknado sequel as an excuse to run a review of chainsaws—the perfect weapon in the battle against sharks falling out of the sky.

Then there’s shark tourism. It might seem odd that any beach community would actively want to associate itself with sharks. Yet the effort to brand Chatham, Mass., the town on the elbow of Cape Cod—near plenty of seals and therefore sharks too—as something along the lines of the Shark Capital of America has been several years in the making. Starting in 2009, news spread that biologists were tagging great white sharks off the coast. Sure, it freaked some swimmers and boaters out, but it also drew the masses to the coast, bearing binoculars with the hope of spotting one of the beasts.

“The great white shark is sexy,” Lisa Franz, Chatham’s chamber of commerce chief, explained to the Boston Globe last summer. “Chatham as a town, I think, has embraced the whole shark concept,” she said. “As long as nobody gets hurt.”

Fast-forward a year, and the shark schlock business is booming. “Truthfully, we’ve probably grown about 500 percent in terms of the sale of our shark apparel,’’ one Chatham tourist shop owner offering “T-shirts, hoodies, hats, belts, dog collars and other accessories” featuring great whites for $10 to $45 told the Associated Press in June.

People seem to love the shark meme so much that local restaurants and shopkeepers understandably have a new fear: They’re scared about what would happen to business if the sharks suddenly went away.

MONEY Shopping

12 Iconic Stores and Restaurants That Are Rapidly Disappearing

RadioShack store in downtown Cincinnati
Al Behrman—AP

A dozen once-ubiquitous retailers and restaurants—places where you probably shopped and dined at as a kid—may soon be shutting their doors.

Moody’s Investors Service said in a report this week that RadioShack is in danger of running out of cash by autumn of 2015, according to Bloomberg News. It’s the latest indication that the struggling chain is doomed, following news in the spring that it planned to close up to 1,100 stores. (Those plans were scaled back to around 200 store closures, but still…) The electronics chain’s difficulties probably shouldn’t come as much of a surprise given the times we live in today. After all, the word “radio” is in the name. Who buys radios anymore?

RadioShack is hardly the only well-known national chain that is flummoxed by the ultra-competitive, rapidly changing modern-day marketplace and shutting locations, among other steps, as a survival tactic. Here are 11 others.

Albertsons
Amid toughening competition in the grocery space—low-cost upstarts, dollar stores, big box all-purpose stores, and online sellers have all stepped up their game—the Albertsons supermarket chain announced earlier this year it would be closing 26 stores, most of them in California. In late July, Albertsons bought Safeway, and the merger is expected to bring about more store closures, most likely ones operating under the Albertsons or Vons brand.

Staples
Quite a lot is riding on the current back-to-school shopping season for Staples. After a subpar fourth quarter last year, it announced it would close as many as 225 stores in 2014, after closing 42 throughout North American in 2013. Declining sales have continued into the first half of 2014, largely due to the widespread consumer “shift to e-retailers, mass merchants and drugstores to buy their office supplies,” as Reuters put it. More closures are inevitable if sales during the all-important back-to-school period aren’t up to snuff—and maybe even if they’re decent, as Staples seems increasingly focused on online sales.

Family Dollar
In April, after yet another report of declining store sales, Family Dollar said it would be shutting 370 locations. Now that rival Dollar Tree is buying Family Dollar, it’s likely that more stores—from one or both of these brands, which often have locations in very close proximity to each other—will disappear.

Quiznos
The toasted sandwich chain peaked sometime in the early ’00s, when it boasted some 5,000 stores around the U.S. Quiznos closed around 2,000 locations during the Great Recession years, not only because household spending budgets shrunk, but also because of increased competition from highly successful Subway and all manner of trendy fast-casual restaurants. The more positive economic climate of recent years hasn’t brought Quiznos back from the brink. The company filed for bankruptcy earlier this year. While Quiznos wants to put this all in the past, a trickling of closures continues, such as one planned to take place in Austin in August.

Aeropostale
24/7 Wall Street put Aeropostale on its list of “10 Brands That Will Disappear in 2015,” and some 125 of its stores are set to disappear by the end of the current fiscal year. The company’s sales and stock price have been cratering due to what’s described as a “seismic shift” in teens’ fashion taste.

Abercrombie & Fitch
Similar to Aeropostale, the much-higher priced Abercrombie & Fitch has cited a “challenging retail environment,” especially among teens, as a prime reason for declining sales—and why it is being forced to close dozens of stores. The overpriced merchandise and the fat-shaming comments of its CEO probably haven’t helped either.

Toys R Us
The continued shift to online shopping, combined with a shift among consumers away from toys and more toward gadgets, has had the toy store giant in a funk for years. To cope with declining sales, there have been thousands of layoffs at the retail and administrative levels, and some expect store closures at any moment. Overall, things look grim. “There is a 50-50 chance the company can survive,” Howard Davidowitz, chairman of the retail consulting firm Davidowitz & Associates, told the The Record in New Jersey, home of Toys R Us’s headquarters. “I’m not saying they are finished. I would not say that. But there is a limited time, given the debt level they have, for this business to get fixed.”

TCBY
Once 1,500 franchises strong, TCBY has closed two-thirds of its locations over the years. TCBY has tried many things to kickstart the business—Greek fro-yo, sharing space with sister brand Mrs. Fields Cookies—but some think that TCBY is likely to suffer the same fate as Crumbs, the trendy cupcake chain that recently shut down.

Barnes & Noble, J.C. Penney, Sears
The decline, and perhaps impending death, of these three iconic, old-timey retailers has been discussed for so long that it’s almost surprising they’re still around. Barnes & Noble has closed 10% of its stores over the last five years, despite the fact that its long-time book-selling rival, Borders, is no longer in the picture, and despite relentless pressure from Amazon.com. J.C. Penney is routinely described as being in a “death spiral” and “at death’s door.” As for Sears, when CEO Edward Lampert was speaking to investors this past spring, he offered a brutally honest vision of what’s to come. “Closing stores is going to be part of our future,” he said.

Read More:
10 Things Americans Have Suddenly Stopped Buying
10 Things Millennials Won’t Spend Money On

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MONEY Shopping

The Stunning Sales Figure That Shows Nobody Wants to Grow Up

Businessman carrying backpack and briefcase
Bloomberg via Getty Images

Working professionals seem to be trying really hard to look like they're still in college.

It’s not exactly like Wall Streeters have started wearing hoodies to the office, but it’s in the same ballpark. In a sign that indicates working professionals are embracing the delusion they could still pass for college students, many are skipping the tired old briefcase and turning to the youthful backpack as their go-to office bag of choice.

AdAge and GQ, among others, have noticed the trend, quantified by data from the NPD Group, which has it that for the 12-month period ending in May 2014, backpack sales among adults 18 and over were up 33%. Among adult women, backpack sales were up 48% over that time span, though men still outspend the gals on backpacks annually: $385 million vs. $311 million.

Clearly, one reason that backpack sales are soaring is simply that they’re practical: They can handle your gym gear, sunglasses, snacks, and an ever-increasing amount of gadgets that just wouldn’t fit in even the largest briefcases. Backpacks are also easier to tote around, especially if you’re on a bike or have a long walk.

We also must acknowledge that the rise of work backpacks goes hand in hand with a turn to more casual dress in the workplace, prompted as least partly by all of those scruffy, hoodie-wearing tech workers. By now, the Swiss Army backpack has become a key component of the official Silicon Valley tech uniform, alongside Warby Parkers, skater sneakers, and a general lack of grooming.

Professionals are allowing themselves to strap on the kind of bag they used when they were 15 without embarrassment or totally looking foolish thanks to the introduction of a wide range of packs that are more, well, professional. Tumi lists dozens of understated, black and earth-tone backpacks in the category of being appropriate for business.

What’s more, the backpack’s versatility and youthful cachet sends a certain message, to the wearer if not the entire world. The message is one of adventure and possibility—that you can jump from the boardroom, to a mountain bike, to an impromptu flight to Copenhagen. The backpack says I may work in an office, but I’m not just another drone commuter. I have more going on in my life than any sad, slim briefcase can handle.

Then again, maybe instead it just says you like pretending you’re still in college.

MONEY Shopping

WATCH: Shop This Weekend and Escape the Sales Tax

Several states are suspending sales taxes to encourage shoppers to hit the stores.

MONEY Saving

You’re Giving Away Money By Shopping Before This Weekend

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Getty

No fewer than 15 states offer a remarkably no-hassle way to trim a few percentage points off back-to-school purchases, most with deals starting this Friday.

Every year around this time, states host sales-tax holidays, in which the usual sales tax is waived on a wide range of purchases. In most cases, tax-free purchases are limited to back-to-school items such as computers and traditional school supplies like notebooks, protractors, and pens, but clothing, footwear, and accessories are typically on the table as well.

What’s more, the tax is waived on online purchases as well as sales in traditional brick-and-mortar stores, and there’s no actual requirement that the items being purchased are for back-to-school prep, or even for kids. It would be too hard to police any such requirement, so instead most states simply limit purchases to a flat dollar amount—for instance, any article of clothing priced at $100 or less, typically.

Let’s be honest: The savings represented by these events isn’t all that spectacular. Most participating states have sales tax rates of 4% to 6%, so that’s the extent of the savings. Big whoop, you might say. But when the tax holiday is combined with terrific sale prices—and virtually every retailer has back-to-school promotions going on right about now—the net amounts paid by shoppers can be true bargains. Why not get an extra 5% or whatever off what is already a good deal, on stuff you absolutely need to buy? To do so, all you have to do is wait a few days.

There are those who say that sales tax holidays are gimmicks for exactly the reason hinted at above. The argument is that the holidays don’t promote more spending as much as they encourage shoppers to strategically postpone spending, with no net increase in purchases whatsoever. What’s more, while sales tax holidays play well in terms of politics, critics say they are questionable at best in terms of local economic stimulus, and that they cost states and municipalities millions in much-needed revenues. States such as North Carolina have dropped their annual sales tax holiday tradition because of this argument, though shoppers did still get to take advantage of a “Better Than Tax Free” sales event at a North Carolina outlet mall last weekend.

Gimmick or not, if you need to buy any of the many, many items eligible for tax-free purchase, you might as well wait until Friday, or whenever your state has its sales tax holiday. Failure to do so is tantamount to unnecessarily paying an extra 6% or so.

Resources including Bankrate and the Federal Tax Administrators site list the basic details, and below are the states with sales tax holidays starting this weekend. Check the links for all of the fine print about what is and isn’t included in your neck of the woods.

Alabama: August 1-3, limited to $30 per book, $50 for school supplies, $100 on clothing, and $750 on computers

Florida: August 1-3, limited to school supplies of $15 or less, $100 per clothing article, and $750 for computers and accessories

Georgia: August 1-2, limited to $20 school supplies, clothing priced at $100 or less, and computers capped at $1,000

Iowa: August 1-2, limited to footwear and clothing priced up to $100

Louisiana: August 1-2, sales tax is waived on purchases of all items for personal (rather than business) use, priced up to $2,500.

Missouri: August 1-3, limited to school supplies of $50 per purchase, clothing and footwear priced up to $100 each, computer software up to $350, and computers or accessories up to $3,500

New Mexico: August 1-3, limited to school supplies up to $30 per item, clothing and footwear up to $100, computer hardware up to $500, and computers up to $1,000

Oklahoma: August 1-3, limited to clothing and footwear up to $100 per item

South Carolina: August 1-3, with sales tax exemptions for all clothing, footwear, school supplies, computers and electronics, college dorm supplies like pillows, blankets, and shower curtains, and even delivery charges on all of the above

Tennessee: August 1-3, limited to clothing, footwear, school and art supplies priced up to $100 each, as well as computers up to $1,500

Virginia: August 1-3, limited to school supplies up to $20, and clothing and footwear of $100 or less per item

And here are a few more states offering tax holidays a little later this summer:

Texas: August 8-10, limited to clothing, footwear, backpacks, and school supplies up to $100

Maryland: August 10-16, limited to clothing and footwear priced up to $100

Connecticut: August 17-23, limited to $300 on clothing and footwear

Massachusetts: Lawmakers in the Bay State have promised shoppers will get a tax-free weekend sometime in August, but they haven’t gotten around to settling on a date yet.

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